The pace of Colorado Springs-area home construction fell in November for the fourth straight month, a likely byproduct of builders who've slowed production because they lack materials and supplies and don't have enough workers.
"Product availability and labor," said Chad Thurber, president of local builder Vantage Homes and incoming board president of the Housing & Building Association of Colorado Springs. "They've plagued our industry locally and I don't know that anyone has escaped that unscathed."
In November, building permits issued for the construction of single-family homes totaled 255 in El Paso County, a 38.7% drop from the same month last year, according to a report this week by the Pikes Peak Regional Building Department, a city-county agency that oversees residential and commercial construction.
Single-family home permits now have declined on a year-over-year basis each month since August, Regional Building Department figures show. The permit numbers reflect construction of single-family detached homes, not townhomes, duplexes, condominiums or apartments.
"It seems like every week, we find a new product or material that is having supply challenges," Thurber said. "Whether it's availability, period, that it's not being produced anymore or that they can't get enough of it to fulfill orders."
For example, Vantage Homes' truss supplier is "substantially behind" in production compared with demand, Thurber said.
"We may have a foundation wait for up to two months, between being ready for framing and being able to start framing, because of the delay in trusses," he said.
Tom Hennessy, president of Challenger Homes of Colorado Springs, said some builders have had trouble getting products such as appliances, windows and garage doors. As a result, they might ease up on construction activity.
"A lot of builders I talk to just don't want to get too far over their skis," Hennessy said. "They're just limiting their production so they can meet the demands of the customers and not be delayed and deliver a home a year later because they couldn't get all the pieces."
A shortage of skilled and qualified labor also has led to a slowdown in production for some builders, Hennessy and Thurber said.
Springs-area home builders and commercial contractors, like their counterparts in other markets, have wrestled with a labor shortage for several years.
Their subcontractors — such as electrical, plumbing, carpentry, concrete and landscaping companies — can't find the workers they need. Or, once hired, some workers show up one day, but don't return the next day.
That problem has been exacerbated over the last year or two as the demand for housing has accelerated, fueled in large part by historically low mortgage rates.
"There's not an extra supply of labor for sure in the market," Hennessy said. "If crews are out, then things just come to a halt. That's a big part of it."
Vantage Homes also has a smaller supply of home sites, or lots, than it normally does, Thurber said. The lack of sites acts as a "natural governor" on Vantage's ability to build and the company has taken a controlled approach to the number of homes it sells, he said.
Still, overall new home purchases remain strong in Colorado Springs, though they've slowed from the frenzied pace of this summer, Hennessy said. New home purchases, Thurber added, are back to a more normal pace.
Even as homebuilders wrestle with supply and labor problems, the area's residential construction industry is enjoying a productive year.
Through the first 11 months of 2021, single-family building permits totaled 4,093, according to Regional Building Department numbers. That's down a slight 1.3% from the 4,148 permits issued during the same period last year.
Despite the decline, permits have now topped 4,000 for the second straight year — the first time permits have surpassed that mark in back-to-back years since 2004 and 2005, Regional Building Department figures show.
"It's still a very good market," Thurber said.